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The vast, untapped potential of YouTube

Stashed in: Advertising, YouTube!, Monetization, Active Users, Advertising, Valuation, Mobile Ads!

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Mother of God:

Google does not currently break out the financial performance for YouTube but analysts at Bernstein Research recently said they think it could generate $7 billion in revenue in 2015, and become a $30 billion a business in the next few years. Compare that to Google as a whole, which last year raked in $33.9 billion in total revenue, minus commissions to traffic partners, according to FactSet.

Their reasoning is simple. YouTube is responsible for about 40% of online video consumption,  which is surging. And yet,  as the below chart from Jefferies shows, relative to other forms of advertising (online and traditional) online video has a long way to run.

US online video ads as a percentage of online ad spend chart meme Imgur

Since Google can target and measure video ads more effectively than other forms of advertising (including TV) the company could conceivably double its ad rates for video without much pushback.

That's... amazing.

That is a lot of video views:

YouTube will have to compete with Facebook’s huge push into online video. But that shouldn’t hold it back; it has a big head start in an explosive market. For the record, Facebook says it gets 1 billion video views per day. YouTube had 4 billion views per day back in 2012, and has grown significantly since then.

I wonder how much of that is on mobile devices.

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